Employment: State contract equity requirements imminent?

Once operational, a draft Employment Equity Amendment Bill gazetted on Friday with proposed amendments to the existing regulations will empower the Minister to set sector-specific ‘numerical targets’ with the aim of ‘ensuring the equitable representation of suitably qualified people’ from designated groups at ‘all occupational levels’ of SA’s workforce, reports Pam Saxby for Legalbrief Policy Watch. According to a preamble to the draft Bill, the proposed new legislation will also strengthen enforcement mechanisms in anticipation of promulgating section 53 of the Act (state contracts). This is noting widespread resistance on the part of employers to workplace transformation.

When the remainder of the Act came into effect nearly 20 years ago, government’s view was that employers should be given the opportunity to develop and implement the ‘processes and systems’ needed to obtain the employment equity compliance certificates required under section 53. Many non-compliant employers are perceived to have taken advantage of this and yet continue to be awarded state contracts. Some are even ‘in breach of the Act’. Against that backdrop, the draft Bill and regulations are expected to ensure that only employers ‘prepared to implement the law’ will qualify to tender for government procurement contracts and ‘reap the benefits’ associated with winning them. While interested and affected parties have until 19 November to comment on the draft Bill, there appears to be no deadline for input on proposed amendments to the regulations.

As Legalbrief Today has already reported, the South African Human Rights Commission recently gave government six months to develop measures to rectify aspects of the Act and the policy underpinning it found to be ‘unconstitutional and not in sync with international conventions’. The commission’s 2017/18 equality report refers specifically the Act’s definition of the term ‘designated groups’ and the ‘system of data disaggregation’ used. Summarising key findings, the report states that ‘government’s failure to measure the impact of various affirmative action measures … (based on) need and disaggregated data … likewise violates international law obligations’. This is ‘especially’ in respect of ‘the extent to which such measures advance indigenous peoples and people with disabilities’. ‘The implementation of special measures in the employment equity sphere is … misaligned to the constitutional objective of achieving substantive equality to the extent that … (it) may amount to rigid quotas and absolute barriers as opposed to flexible targets’, the report continues. ‘This practice may inadvertently set the foundations for new patterns of future inequality and economic exclusion within and among vulnerable population groups.’

Addressing a recent National Economic Development and Labour Council (Nedlac) summit in Johannesburg, Labour Minister Mildred Oliphant told delegates that the commission’s findings and related recommendations will ‘demand special attention’, especially from Nedlac’s social partners. Yet neither the Minister nor her department has issued a formal statement on the issue. Hopefully, stakeholders participating in public hearings on the draft Bill and regulations will question the timing of their release given the commission’s concerns. According to a press release on the proposed new legislation, hearings ‘will be conducted in all nine provinces during October … to raise public awareness and solicit oral representations’ on the amendments envisaged. At this stage, clause 4 of the draft Bill provides for prior consultation on any sector-specific numerical target set by the Minister. Related to this, among other things the proposed new regulations prescribe criteria to be met in determining a sectoral numerical target, including: the necessary qualifications, skills and experience; the ‘capacity to acquire, within a reasonable timeframe, the ability to do the job’ concerned; ‘the rate of turn-over and natural attrition’; and ‘recruitment and promotional trends’. They also spell out the criteria to be met and procedures followed in applying for a section 53 certificate. Substantive amendments are proposed to existing regulations on the duty to report and the procedures to be followed in serving a compliance order.